Securities Law - ODC

The appellants appealed a Capital Markets Tribunal decision finding they committed securities fraud by selling cryptocurrency tokens falsely represented as backed by gold bullion and misappropriating investor funds.

On appeal, they argued the Tribunal erred by admitting compelled interview transcripts, finding the tokens were securities, denying an adjournment, and imposing unfit sanctions.

The Divisional Court dismissed the appeal, holding that compelled testimony is admissible in the same regulatory proceeding, the tokens met the test for an investment contract, and the Tribunal's factual findings and sanctions were reasonable and entitled to deference.

The appellant appealed a decision of the Capital Markets Tribunal finding he breached a 15-year trading ban by participating in stock secured financings.

The Tribunal found that the lenders' sales of pledged securities constituted trades, and the appellant's actions, including sourcing financing and analyzing the value of the pledged equities for compensation tied to the sales' profits, were acts in furtherance of those trades.

The Divisional Court dismissed the appeal, holding that the Tribunal made no palpable and overriding error in its contextual analysis of the appellant's conduct.

The appellants appealed two decisions of the Ontario Securities Commission finding they committed securities fraud, unregistered trading, and illegal distribution, and imposing sanctions including a joint and several disgorgement order of approximately $8.7 million.

The appellants argued they were denied procedural fairness when the Commission refused to adjourn the merits hearing and restricted cross-examination, and that the joint and several disgorgement order was demonstrably unfit.

The Divisional Court dismissed the appeal, finding no breach of procedural fairness in the adjournment refusal or hearing conduct, and holding that the Commission's broad public interest discretion under the Securities Act permitted joint and several disgorgement orders.

The appellants appealed decisions of the Capital Markets Tribunal finding they engaged in a course of conduct that perpetrated a fraud on investors by raising funds for a specific real estate project and diverting them for other purposes.

The Tribunal ordered administrative fines, disgorgement, costs, and permanent market bans with a limited carve-out.

The Divisional Court dismissed the appeal, finding no palpable and overriding errors of fact or errors of law in the Tribunal's liability findings or sanctions.

The appellants brought motions under Rule 59.06 to set aside a 2018 Divisional Court judgment that upheld securities fraud findings and sanctions against them.

In response, the Ontario Securities Commission moved for security for costs and to strike out seven expert reports filed by the appellants.

The Divisional Court granted the Commission's motions, ordering the appellants to post $100,000 in security for costs due to unpaid prior costs awards.

The court also struck out all seven expert reports, finding they improperly opined on matters of domestic law and factual findings that are the exclusive province of the court, failing the necessity criterion for expert evidence.

The appellant, a former chairman of a publicly traded cannabis company, appealed decisions of the Capital Markets Tribunal finding he breached the prohibition against tipping material non-public information under s. 76(2) of the Securities Act and imposing sanctions.

The appellant had shared draft transaction documents with a personal friend and business colleague.

The Divisional Court upheld the Tribunal's findings that the appellant bore the onus of proving the disclosure was in the 'necessary course of business' (NCOB), that the NCOB test is purely objective, and that the disclosure was not necessary.

The Court also dismissed the appellant's argument that an objective NCOB test unjustifiably infringed his freedom of expression under s. 2(b) of the Charter, finding any infringement was justified under s. 1.

The appeal against the merits and sanctions decisions was dismissed.

The moving party brought a motion under s. 21(5) of the Courts of Justice Act to set aside a decision of a single judge of the Divisional Court.

The single judge had quashed the moving party's appeal from a pre-hearing decision of the Capital Markets Tribunal on the basis that the Tribunal's decision was interlocutory, not final.

The Divisional Court panel dismissed the motion, finding that the motion judge applied the correct law and made no error in concluding that the Tribunal's decision regarding the use of criminal disclosure was not a final decision.

The appellant, a former employee of a Toronto Stock Exchange (TSE) member, appealed a decision of the Ontario Securities Commission (OSC) which upheld a ruling by Market Regulation Services Inc. (RS).

The OSC found that the Universal Market Integrity Rules (UMIR) were enforceable against the appellant for conduct that occurred during his employment, despite his subsequent resignation.

The Divisional Court dismissed the appeal, finding it reasonable for the OSC to conclude that the TSE validly adopted the UMIR and that RS had jurisdiction to discipline former employees for misconduct committed while they were employed by a TSE member.

The applicant, a former officer of Nortel, sought judicial review to prohibit the Ontario Securities Commission from proceeding with a hearing against him.

He argued that the Commission's prior settlement with Nortel, which included admissions of misconduct by its managers, created a reasonable apprehension of bias against him.

The Divisional Court dismissed the application as premature, finding no exceptional circumstances to justify fragmenting the administrative proceedings before the Commission had an opportunity to consider the matter and hear evidence regarding the applicant's actual role.

Following the dismissal of the appellants' motion to adduce fresh evidence and their appeal, the respondent sought partial indemnity costs.

Although the respondent's partial indemnity costs amounted to $12,875, it sought a reduced award of $4,000 to avoid inhibiting self-represented parties from pursuing appeal rights.

The court found the issues were not complex and the requested amount was modest, fixing costs at $4,000 inclusive of disbursements and GST.

The appellants appealed an Ontario Securities Commission (OSC) order finding they violated securities law by operating an RRSP/loan scheme without registration or a prospectus.

The appellants argued the OSC erred in refusing an adjournment, sought to introduce fresh evidence, and challenged the OSC's findings.

The Divisional Court dismissed the appeal, holding that the refusal of the adjournment was justified, the fresh evidence did not meet the test for admission, and the OSC's findings of unregistered trading and public interest violations were reasonable.

Sears Holdings Corporation appealed a decision of the Ontario Securities Commission regarding its insider bid for Sears Canada Inc. The OSC had found that Holdings failed to comply with disclosure obligations, entered into agreements that contravened the Securities Act, and engaged in abusive and coercive conduct.

The Divisional Court dismissed the appeal, holding that the standard of review for OSC decisions interpreting its constituting statute is reasonableness simpliciter, and that the OSC's findings and remedies were reasonable.

The appellant appealed a decision of the Ontario Securities Commission finding that he failed to meet the standards of business conduct expected of a CEO and imposing sanctions under s. 127 of the Securities Act.

The Commission found the appellant had primary responsibility for a stock subscription program that lacked commercial justification and failed to take steps to contain the situation when problems emerged.

The Divisional Court dismissed the appeal on the merits, finding the Commission's conclusions were reasonable and supported by evidence.

On consent, the appeal regarding sanctions was allowed and remitted to the Commission for a new hearing.

The appellant company appealed a decision of the Ontario Securities Commission which found that the company had waived solicitor-client privilege over certain legal opinions by providing them to its auditor.

The Divisional Court allowed the appeal, holding that statutory disclosure of privileged documents to an auditor constitutes a limited waiver for audit purposes only, not an absolute waiver.

Furthermore, the auditor's subsequent unauthorized disclosure of the documents to Commission staff did not waive the privilege, as the auditor lacked the authority to do so.

The appellants appealed a decision of the Ontario Securities Commission (OSC) that upheld the Investment Dealers Association of Canada's (IDA) disciplinary actions against them.

The IDA had fined the appellants and terminated their membership for failing to provide documents during an investigation into alleged principal trading in an error account.

The appellants argued the IDA lacked jurisdiction, its by-laws violated the Charter, and the investigation was unreasonable.

The Divisional Court applied a reasonableness standard of review and dismissed the appeal, finding the IDA is not a government entity subject to the Charter, its investigative powers are valid under the regulatory scheme, and its disciplinary process and penalties were reasonable.

The appellant appealed a decision of the Ontario Securities Commission that set aside a decision of the IDA District Council and substituted a harsher penalty for his involvement in facilitating a market manipulation scheme.

The Divisional Court dismissed the appeal, finding that the Commission applied the correct standard of review, properly concluded that the District Council misapprehended material evidence, and reasonably substituted its view of the public interest in imposing a severe penalty including a fine and suspension.

Deloitte & Touche LLP appealed an order of the Ontario Securities Commission authorizing the disclosure of written answers provided by Deloitte during an investigation to the respondents in a related enforcement proceeding.

Deloitte argued the information was not relevant, that disclosure was not in the public interest, and that the information was privileged.

The Divisional Court dismissed the appeal, finding the Commission reasonably concluded the information was relevant to the respondents' ability to make full answer and defence, that the public interest favoured disclosure, and that the information was not privileged because it did not originate in confidence.

The appellant appealed decisions of the Ontario Securities Commission finding he acted as an unregistered adviser and imposing sanctions, including a $300,000 costs order, for failing to disclose conflicts of interest while recommending securities at investment seminars.

The Divisional Court applied the pragmatic and functional approach, determining the standard of review was reasonableness for the merits and public interest findings.

The court upheld the Commission's findings that the appellant was in the business of advising and that his failure to disclose conflicts was contrary to the public interest.

However, the court found the Commission's process for determining the $300,000 costs award was procedurally unfair and remitted the costs issue back to the Commission.

The applicant, Universal Settlements International, Inc., sought judicial review of an Ontario Securities Commission decision upholding an investigation order.

The applicant, which sold viatical settlement purchase programs, argued the Commission lacked jurisdiction because the applicant was neither a reporting issuer nor a registrant under the Securities Act.

The Divisional Court applied a reasonableness standard of review and dismissed the application, finding the Commission has broad statutory powers to investigate matters it considers expedient for the due administration of securities law and the protection of the public interest, regardless of the applicant's registration status.

The applicant brought a motion for a stay of an Ontario Securities Commission order requiring the production of documents and business records pursuant to s. 11 of the Securities Act.

The documents were sought as part of an investigation to determine if the Commission had jurisdiction to regulate the applicant's viatical settlement products.

The court granted the stay, finding that the applicant met the three-pronged test: there was a serious issue regarding the Commission's jurisdiction, irreparable harm would occur as the judicial review would be rendered moot without a stay, and the balance of convenience favoured the applicant given the impending hearing date.